What is an employee’s responsibility to make up a cash draw shortage?

UPDATED: Sep 30, 2022

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What is an employee’s responsibility to make up a cash draw shortage?

At the end of the day, an employee had a shortage of their cash drawer. There were 2 other people who used it and 1 was me. When hired, policy stated that only 1 person per register never to share and 1st time having a shortage would be a written warning. No where did it say it must be paid back. The manager said that we must split the shortage and pay it back. I asked if we paid it back would there still be a warning and he said no. Is this legal?

Asked on November 16, 2015 under Employment Labor Law, Indiana


M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

The law in most states is that as long as an employee still earns at least the minimum wage after a deduction for a cash drawer shortage, there's no prohibition against charging the employee(s for such a shortage. This is true providing this has been existing company policy. If it is a new policy, the employee can only be charged for shortages after the policy went into effect.
That having been said, some states require employers to get the employee's written consent before they can make this type of deduction directly from an employee's paycheck. And a few states only allow these deductions if the employer can show that the employee acted dishonestly or negligently, or if the employee assumes responsibility for the loss.
Therefore, unless you have a union agreement or an employment contract that prohibits you from being held liable for a cash draw shortage, your employer's action is most probably permissable. To be sure, contact your state's department of labor or an employment law attorney.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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